Home Prices Rose in August Despite Sales Decline

(CN) — Home prices rose across the United States in August compared to a year earlier, but those rising prices may be slowing sales, Standard & Poor’s reported Tuesday.

The Standard & Poor’s CoreLogic Case-Shiller national home price index increased 6.1 percent in August from a year earlier.

That’s up from the 5.9 percent annual gain in July.

In nine of the 20 cities tracked by the index, yearly price gains in August were faster than in July.

Seattle, Las Vegas and San Diego reported the highest year-over-year gains among the 20 cities. In August, Seattle led the way with a 13.2 percent year-over-year price increase, followed by Las Vegas with an 8.6 percent increase, and San Diego with a 7.8 percent increase. Nine cities reported greater price increases in the year ending August 2017 versus the year ending July 2017.

Meanwhile, industry analysts say fewer Americans are selling their homes, and builders aren’t putting up enough new houses to meet burgeoning demand. That’s heated up competition for properties on the market and pushed up prices.

“Home price increases appear to be unstoppable,” said David Blitzer, managing director and chairman of S&P Dow Jones Indices’ index committee. “The ongoing rise in home prices poses questions of why prices are climbing and whether they will continue to outpace most of the economy.”

Historically low mortgage levels are also increasing the pool of potential buyers, contributing to price-escalating demand.